Posted: 02/16/2015 11:01 am EST Updated: 02/16/2015 6:59 pm EST America is the land of breakthrough science -- and health care scams. The two seem to go hand in hand in the case of the new hepatitis C virus (HCV) cure named sofosbuvir, sold under the brand name Sovaldi by the drug company Gilead Sciences. There is no question that Solvadi is a godsend -- a lifesaver for millions of Americans, and perhaps someday for hundreds of millions of people around the world infected by Hepatitis C. Yet Sovaldi is also the poster child of a U.S. health care system that is being bankrupted by greed, lobbying and indefensible policies on drug pricing. The basic facts are these. In December 2013, the Food and Drug Administration approved Sovaldi, and another formulation, Harvoni, which is sofosbuvir used in combination with another drug. Gilead set the price for a 12-week treatment course of Sovaldi at $84,000, amounting to $1,000 per pill. Gilead set the price of Harvoni at $94,000. According to researchers at Liverpool University, the actual production costs of Sovaldi for the 12-week course is in the range $68-$136. Indeed, generic sofosbuvir is currently being marketed in India at $300 per treatment course, after India refused to grant Gilead a patent for the Indian market. In other words, the U.S. price-cost markup is roughly 1,000-to-1! How can Gilead Science charge $84,000 for a drug that costs less than $300 to produce? First, Gilead's patent on sofosbuvir runs until 2028, giving it a monopoly in the U.S. market. Second, a range of Federal and state government programs will cover the $84,000 for a sizeable number of patients. For those not covered by government programs, some will be covered by private insurance, a few will pay out of pocket, and still others will likely die because they lack coverage and can't afford the treatment. In the first year of marketing, Sovaldi and Harvoni are already blockbusters, reaping a remarkable $12.4 billion of market sales in 2014, more in just one year than the $11.2 billion price that Gilead paid in January 2012 to buy sofosbuvir from a biotech start-up named Pharmasett. The standard defense by the drug companies of these astronomical prices is that drug discovery is costly and their high profits reimburse the R&D costs. Here is where the story of Sovaldi gets even more interesting. The total private-sector outlays on R&D were perhaps $300 million, and almost surely under $500 million, meaning that the decade-long R&D outlays were likely recouped in a few weeks of drug sales. Here is the background. Sofosbuvir was developed under the leadership of Prof. Raymond Schinazi, a brilliant professor of biochemistry at Emory University. The U.S. Government heavily funded Prof. Schinazi's research, with major grants from the National Institutes of Health (NIH) and support from the Veterans Administration. Like many academic researchers, Schinazi has frequently parlayed his government grants into private companies to market his discoveries. He set up Pharmasset Inc. as a Delaware corporation in 2004 as his business to develop sofosbuvir and hold the patents on the new prospective drug. Pharmasset raised around $45 million in a 2007 IPO and used those funds and others to supplement the R&D. According to the company's SEC filings, the total Pharmasset R&D on sofosbuvir up through 2011 totaled around $62.4 million. In January 2012, with an eye on sofosbuvir, Gilead paid $11.2 billion to purchase Pharmasett. Schinazi pocketed an estimated $440 million for his shares in Pharmasett. By the fall of 2011, sofosbuvir was ready for Phase 2 clinical trials, which were carried out between October 2011 and April 2012 by the NIH, which published the results in the Journal of the American Medical Association in 2013. Phase 3 trials were then carried out in mid-2013 and were paid by Gilead, at a cost of perhaps $50-$100 million for a two-month trial that covered around one thousand patients. (Gilead has not disclosed the exact costs of the Phase 3 trials). To read rest of article: http://www.huffingtonpost.com/jeffrey-sachs/the-drug-that-is-bankrupt_b_6692340.htmlJeffrey SachsDirector, Earth Institute at Columbia University

By Mathew RodriguezFrom TheBodyPRO.comFebruary 11, 2015 Who has the power to prescribe medications? In the ongoing struggle to cure the estimated 3.2 million people living with chronic hepatitis C virus (HCV) infection in the U.S., the answer may not be who you think. While common sense may suggest that you and your doctor have the final say over what medications you take, HCV treatment advocates warn that a net of restrictions, gatekeepers and business deals are increasingly tying doctors' hands as far as what they can do for their patients who need HCV treatment.The knots binding prescribers' hands got tighter and more complex as the companies that make the newest (and most expensive) generation of HCV drugs cut exclusive deals with pharmacy benefits managers (PBMs). In the U.S., a PBM is usually a third-party agency that processes and pays out an insurance company's prescription drug claims. It also handles creating formularies, which are the lists of approved drugs available to people with particular health insurance plans.The current controversy began in December 2014, when Express Scripts, the nation's largest PBM (with access to 25 million patients), agreed to an exclusive deal with AbbVie, maker of the recently approved HCV regimen Viekira Pak (ombitasvir, paritaprevir and ritonavir tablets co-packaged with dasabuvir tablets). The deal made Viekira Pak the sole treatment option for those living with HCV who have Express Scripts as their PBM. Steve Miller, M.D., chief medical officer of Express Scripts, toldThe New York Timesthat the deal would yield "a significant discount" over Viekira Pak's sticker price of $83,319 for a standard 12-week treatment course.Then, in January, a number of PBMs -- including CVS Health, Anthem and EnvisionRx -- reached similar deals with Gilead Sciences for exclusive distribution of its HCV drugs, Harvoni (ledipasvir/sofosbuvir) and Sovaldi (sofosbuvir). Gilead drew the ire of many advocates last year after setting a high retail price for Sovaldi, the first of a new wave of HCV drugs that offer higher cure rates, fewer side effects and a faster course of treatment than older alternatives. Sovaldi's price was set at $84,000 for a 12-week regimen, or $1,000 per daily pill. Harvoni comes in at about $94,500 for a 12-week regimen, or about $1,125 per daily pill. Gilead's exclusive PBM deals suggest lower drug prices for people who are covered by those PBMs, although specific numbers have not been released.While deals like these are actually common, the arrangements reached by Gilead and AbbVie for their HCV drugs are a little harsher than usual. A deal between a pharmaceutical company and a PBM makes that company's drug the preferred option for people whose insurance plans are handled by the PBM. However, these deals may put access to any HCV drug that is not the preferred regimen out of reach -- and these new drugs are not all equally effective or useful for every person living with HCV.

"This Weird Rube Goldberg Machine"Though most popularly known for its work in fighting the HIV/AIDS epidemic, the AIDS Coalition to Unleash Power New York (ACT UP NY) recently turned its attention to HCV, according to member Annette Gaudino. For Gaudino, these drug access wars are bad news for patients. "The drug that your doctor prescribes should reflect your hepatitis C genotype and the success that the drug's going to have in treating your version of the virus, not the exclusive deal that the PBM that you happen to have has," she said.In layperson's terms, according to Gaudino, "Competition equals good, exclusivity equals bad. Our demand remains that treatment decisions be guided by the clinical judgment of treating physicians, not cost." Gaudino warned that the growing number of exclusivity deals is adding more complexity to an already complex system that creates "this weird Rube Goldberg machine in which, in the end, what winds up happening is everybody in this clusterf*** daisy chain gets paid -- and we all get screwed."Proponents of the PBM deals say that they will ultimately drive down the cost of treatment. Gaudino is quick to deny that claim. "The only way that you can argue that exclusivity deals drive costs down is that in pitting two very similar drugs against each other, it incentivizes somewhat of a price war between the two manufacturers and those two drugs," she said. However, "These exclusivity deals are just [about] who gives the biggest discount. CVS got their exclusivity deal and Express Scripts has theirs. And they're happy. I don't really see the pharmaceutical companies coming back withbiggerdiscounts. Because why should they, right?""Ultimately, it seems like doctors are really losing their purview to prescribe. ... You're not supposed to say 'Let's see what your insurance company will pay for.'"With PBMs hoping for a discount rather than an ongoing battle that drives down prices further over time, patients may still be left paying far more for an HCV cure than they should, Gaudino suggests. Advocates also note that while the PBM deals may offer a slight discount, the list prices of the drugs remain exorbitant. As Tracy Swan, hepatitis and HIV project director at Treatment Action Group (TAG), noted in anearlier interview, "We keep hearing, 'This is cheaper than this that and the other,' but that's like saying, 'It's cheaper to buy a Cadillac now than it will be to buy a Cadillac in five years,' and it has nothing to do with what it actually costs to produce the Cadillac."In that earlier interview, Swan expressed similar concerns to Gaudino's over the scope and power that PBMs exert in deciding patient treatment regimens. "Although anything that increases access to treatment is a great thing, I really am not comfortable with the idea that your insurance company, rather than yourself with your own physician, decides what treatment is right for you," she said. "I think we're walking down a dangerous road when we start going that way.""Ultimately, it seems like doctors are really losing their purview to prescribe," Swan added. "That's what you're supposed to do when you're a doctor. You're not supposed to say 'Let's see what your insurance company will pay for.'"To read rest of article: http://www.thebodypro.com/content/75504/in-the-age-of-the-hep-c-cure-discount-deals-tie-do.html

By Max NisenFebruary 5, 2015When California based Gilead Sciences announced a breakthrough treatment in late 2013 that cures most kinds of Hepatitis C, people were outragedat the cost: $84,000 in total, or nearly $1,000 a pill.There are more expensive drugs, but Gilead Science’s hepatitis drugs’—Sovaldi and Harvoni—combination of eye-popping price, sales, and patient population (100 million plus worldwide) is unprecedented (paywall).But on February 3rd, Gilead announced in its quarterly earnings call that it expects to cut the price of its Hepatitis C drugs an average of 46% this year in the US. That’s double last year’s discount. Some government plans will pay less than half the list price for Harvoni (a Gilead follow up treatment that combines Sovaldi’s active ingredient with another drug).And the reason why can be summed up in one word: Competition.Illinois based AbbVie launched a competing drug, known as Viekira Pak, late last year sparking a heated price war as the two companies fight to sign exclusive deals with the middlemen that buy the drugs. Few people pay sticker price for expensive prescription drugs. They’re usually bought through a contract by their insurer, or a government health plan. Drug companies give discounts to convince these plans to prefer their drug over another, exclude a competitor, or to offer it to more of their patients.As shocking as list prices are, they’re usually only a starting point.The sheer size of the market and price of the drugs mean negotiations are extremely intense. Sovaldi and Harvoni combined nearly outsold the best-selling drug in the world last year which was AbbVie’s anti-arthritis drug, Humira.One analyst called the size of the price cutsa “shock”(paywall). Gilead’s stock is down more than 7%, AbbVie’s only slightly less, and the entire biotechnology sector took a hit.This is a big deal, for more than just investors.Cheaper prices mean more patients will get these drugs. Many plans restricted access to only very sick patients because it was so expensive. Now more people will get a cheaper cure, an earlier one, and will suffer fewer side effects, which is one of the prime benefits of the drug. That’s a very good thing, though it might not feel that way to shareholders.http://qz.com/338840/prices-for-the-miracle-drugs-that-cure-hepatitis-c-are-collapsing/

Exclusive pharmacy benefit-manager deals with drug makers to cover costly hepatitis C drugs are not making it any easier for most patients to get the drugs.Nick White/CorbisMany Americans are stuck waiting for access to new drugs that can cure hepatitis C.RelatedFAST FACTSThe latest antiviral drugs can cure chronic hepatitis Cfor over 90 percent of patients.Medicaid covers one millionpeople with hepatitis C, but sharply limits coverage of newer treatments.Many doctors believe that everyoneinfected with the virusshould be treated with the new drugs.Exclusivity deals between pharmacy benefit managers (PBMs) and the makers of expensive new hepatitis C drugs have some observers hoping competition will begin to force down prices. But physicians and advocates forhepatitis C patientssay these deals have done little to increase access to these curative drugs for the patients who need them.“It's Maserati and Ferrari having a price war,” saysPeter Bach, MD, the director of the Center for Health Policy and Outcomes at Memorial Sloan-Kettering Cancer Center in New York City, who has written extensively aboutdrug pricing. List prices for the newest hepatitis C treatments start at $83,000 and go up from there, but are about 10 times as high they should be, Dr. Bach says. “These are still enormously expensive drugs, and a real price war would probably have a very different dynamic.”Doctors and patient advocates feel most optimistic about a deal between ExpressScripts and drug manufacturer AbbVie to cover the hepatitis C medication Viekira Pak without limiting patients’ access to the drug — announced in December 2014. While the deal also included an undisclosed price discount for ExpressScripts, that isn't what matters to patients, saysCamilla Graham, MD, the co-director of the Viral Hepatitis Center in the Division of Infectious Disease at Beth Israel Deaconess Medical Center in Boston.“From my perspective, I don't care what the price is. What matters is that it's a price that allows the patients who I want to have access to that medicine to have treatment with that medicine,” Dr. Graham says.“I get a little bit concerned when we have exclusivity deals and none of these price cuts that the payer is receiving from the pharmaceutical company translate to ease of access,” saysStacy Trooskin, MD, PhD, an assistant professor in the Division of Infectious Diseases and HIV Medicine at Drexel University College of Medicine in Philadelphia.The latest deal, shortly followed by CVS's disclosure that it will only cover drug manufacturer Gilead's hepatitis C meds Harvoni and Sovaldi, is great news for the hepatitis C patients with private, employer-based insurance with pharmacy benefits managed by ExpressScripts. CVS has not disclosed whether it will also lift restrictions on access to the medications as part of its deal.Access to New Drugs Limited for Medicaid PatientsNeither of these announcements will make it easier for patients on Medicaid — who account for one-third of the3 million hepatitis C patientsin the US — to get the new medications. They still face a crazy quilt of restrictions on access to the costly drugs, given that each state runs its own Medicaid program, and none have the budget to cover them at their list price.

Some states will only cover the drugs for patients with the most severe liver scarring.

Many also say patients must be prescribed the drugs by a liver specialist.

Patients with substance abuse problems have to demonstrate sobriety to be covered.

Ryan Clary, the executive director of theNational Viral Hepatitis Roundtable, an advocacy coalition for patients with hepatitis in San Francisco, says refusing to cover treatment for patients who aren't “clean” is discriminatory. “Hepatitis C is a disease that affects a lot of people who currently or have used drugs, and that's the reality, and we want this to be treated as a health issue between doctor and patient,” Clary says. While insurers argue that patients need to be sober in order to take medications as prescribed, Clary noted, many physicians are successfully treating patients who are not sober with the newer, curative medications.Pennsylvania's Medicaid program, for example, restricts access to the new hepatitis C medications to patients with the most severe liver damage, and these patients must be sober. “Patients need to demonstrate that they have abstained from drugs and alcohol prior to the initiation of therapy,” says Dr. Trooskin. “Those two things together have made it very difficult to get the drug easily to all of our patients,” she added. “We've had other patients that have been denied drugs just because they have marijuana in their urine, and they're adherent to all of their other recommended medications.”“We're finding that our poorest and disproportionately minority patients are being adversely affected by the restrictions that Medicaid has, and they're usually unwavering in those restrictions,” Trooskin says.RELATED:Hepatitis C: Special Risks for WomenChoice of Treatment vs. Rationing of Care“What it really comes down to is we're looking at a struggle between choice of treatment. Do we get to choose which treatment we want to use, or access to treatment, do we have the ability to treat anyone who comes to us with hepatitis C?” says Graham. “Normally we like to have a choice in both of those realms.” But when forced to pick one, Graham adds, “I would choose access to treatment, hands down every day.” Every single Viekira Pak prescription Graham has written for her Medicaid patients has been denied, she says. “Things aren't going so well, and Massachusetts, I will say, has the best access of any state. Our Medicaid doesn't have ridiculous restrictions,” she added. “I'm calling them restrictions, but it's really rationing. We're seeing rationing of care for hepatitis C like I've never seen in U.S. medicine.” Doctors say they are seeing rationing of hepatitis C care like never before.At the heart of the issue is whether everyone with hepatitis C should receive curative treatment, given that most won't go on to develop severe liver damage, Bach says. About 10 percent to 15 percent of people withchronic hepatitis C infectionwill develop cirrhosis. But many doctors who treat patients with hepatitis C feel strongly that everyone with the virus who wants to be cured should get curative treatment. Right now, many simplycannot afford it. Find experts’ tips on how topay for costly hepatitis C drugshere.“It's going to take a very novel approach and a coming together of all parties to come up with a solution, to come up for treatment for everyone who needs it, which is everyone who's positive,” Trooskin says.http://www.everydayhealth.com/news/hepatitis-c-drug-price-wars-unlikely-boost-access-medications/

February 2, 2015By Karyn Kaplan-Treatment Action GroupFrom the IntroductionLiver disease from hepatitis C virus (HCV) is one of the leading causes of death around the world. At least 185 million people have been infected and almost 500,000 people die from it each year. The hope for eradicating HCV has recently gained new momentum: effective treatments reaching a 100 percent cure rate in clinical trials are now available. But unaffordable drug prices and expensive diagnostic tools are keeping HCV cures from the majority of people who need them—those living in low- and middle- income countries (LMICs).There are many significant barriers to HCV eradication: the lack of accurate epidemiological data, which are necessary for development of policies, programs, and resource allocation; the criminalization of people who inject drugs and the banning of harm reduction programs, which perpetuate ongoing HCV infection; and the absence of global and national political will (with few exceptions) to address the epidemic.

But AIDS activists have developed and implemented successful strategies to overcome similar challenges in addressing the HIV epidemic. From Johannesburg to New York, Río de Janeiro to Bangkok, activist-driven policies have helped more than 10 million people gain access to HIV treatment. Antiretroviral therapy (ART) has saved 4.2 million lives in LMICs—despite the belief among policy makers and world leaders that doing so would be impossible.While HCV and HIV differ in significant ways (for example, HCV can be cured with short-course treatment, while HIV treatment is lifelong), lessons learned from three decades of AIDS activism are useful for the growing HCV activist movement.Activist Strategies for Increasing Access to HCV Treatment in Low- and Middle-Income Countriespresents a number of key strategies through real-world case studies and shows how strategies used to combat the AIDS epidemic can be—and have been—adapted to increase HCV treatment access.These strategies are introduced in three sections:Section One: Laying the Groundwork through Community OrganizingStrategy 1: Framing HCV Treatment and Prevention as Basic Human Rights, Particularly for Injection Drug UsersStrategy 2: Organizing People Living with HCV for Community Education and MobilizationStrategy 3: Forming Alliances with Local, Regional, and Global Organizations to Influence PolicyStrategy 4: Demanding Global HCV Policies and Funding Streams Section Two: Overcoming the Cost Barriers to HCV Treatment AccessStrategy 5: Negotiating Lower Prices with Drug CompaniesStrategy 6: Challenging Intellectual Property Barriers through Patent OppositionsStrategy 7: Overriding Patent Barriers through Compulsory Licenses and Parallel ImportationSection Three: Collaborating with Researchers to Build Your Case for HCV Treatment AccessStrategy 8: Using Mathematical Modeling to Predict Cost-Effectiveness and Public Health Benefits of HCV TreatmentStrategy 9: Advocating for Policies and Programs Based on Evidence Provided by Operational Researchmakers and world leaders that doing so would be impossible.http://www.treatmentactiongroup.org/hcv/publications/activist-strategies-increasing-access-hcv-treatment-low-and-middle-income-countries